Professional Documents
Culture Documents
Country Analysis
Brazil
. 01-Mar-12
CONTENT Introduction Brazil annual report: Economic Indicator Government and Politics Foreign Relations States and Municipality Geography Climate Component and Energy Transport Demography Main Drivers for Doing business in Brazil Mani Challenges of Doing Business in Brazil Summary of Indicator- Doing business in Brazil List of Procedure PESTLE Political y Political system y Change in government y Lula administration focus area y Law Economic y Economy of Brazil y Industrial output y Key industries y FDI Sociological y Culture y Language y General attitude y Personal appearance
Technological y Technology research y Information technology y R&D y Technology policy of Brazil y Brazilian industry and Technology Legal y Legal system of Brazil y Municipality y Court and justice Environment y National y The Future
Introduction
Brazil is the largest and most powerful country in South America and has become one of the world's most attractive emerging markets in recent years. Brazil accounts for almost half of South America's total population and landmass and has established itself as the dominant power in South America. Moreover, Brazil's rapid economic diversification is allowing it to transform itself into a modern economy, playing a key role in a variety of industries.
Brazil accounts for three fifths of the South American economys industrial production and integrates various economic groups, such as Mercosur, G-22 and the Cairns Group. The countrys scientific and technological development, together with a dynamic and diversified industrial sector, is attractive to foreign enterprise: direct investment was in the region of US$ 20 billion /year on average, compared to US$ 2 billion/year last decade.
Brazil is a founding member of the United Nations, the G20, Mercosul and the Union of South American Nations, and is one of the BRIC Countries. Brazil is also home to a diversity of wildlife, natural environments, and extensive natural resources in a variety of protected habitats.
Industry and technology are shining stars of Brazils economy. The nations industrial sector accounts for one-third of GDP, and includes steel, petrochemicals, computers, aircraft, and consumer durables. Its technological sector encompasses submarines, aircraft, and space research, including involvement in construction of the International Space Station. It is also a leader in ethanol production and research into deep-water oil, the source of 73% of its reserves. And Brazils automotive industry is enjoying a boom period, as access to credit, economic stability, and lowered interest rates have increased consumer confidence and boosted car sales in Brazil to the highest levels in the countrys history.
The World Bank classifies Brazil as a lower- middle-income country. However, the economy is large and diverse, and exports are geographically well spread. There have been profound changes and durable reform in the past 10-15 years the end of hyperinflation, economic liberalization, improved public finances, and a successful transition from a fixed to a
floting exchange rate. This has been reflected in increased domestic savings and exports of goods and services. Nonetheless, annual average economic growth in the past 10 years was modest, as the economy suffered a series of crises related to poor public debt dynamics in the context of a historical tendency to periodic debt default. The most recent crisis was in 2002, and it was ended by the incoming governments tight fscal and monetary measures, consistent meeting of International Monetary Fund targets, and market-friendly structural reforms. Instability has remained at bay despite political scandal and elections.
Brazil trades regularly with over one hundred nations, with 74% of exports represented by manufactured or semi manufactured goods. Its main partners are: the EEC (representing 26% of the balance), the US (24%), Mercosur and Latin America (21%) and Asia (12%). One of the most dynamic sectors in this trade scenery is the so-called agrobusiness sector, which for two decades has kept Brazil amongst the most highly productive countries in areas related to the rural sector.
The owner of a sophisticated technological sector, Brazil develops projects that range from submarines to aircraft and is involved in space research: the country possesses a Launching Center for Light Vehicles and was the only country in the Southern Hemisphere to integrate the team responsible for the construction of the International Space Station-the ISS. A pioneer in the field of deep water oil research, from where 73% of its reserves are extracted, Brazil was the first capitalist country to bring together the ten largest car assembly companies inside its national territory.
Brazil is weathering the current global economic crisis better than most other Latin American countries. Thanks to the recent development of a large middle class, together with the expansion of the country's natural resource-based industries, Brazil has managed to avoid falling into a deep recession in recent years, unlike nearly all of its Latin American neighbors. Moreover, the rapid expansion of the country's oil industry will help to boost Brazilian economic growth over the near-term.
BRAZIL Annual Report GDP Nominal GDP (US$ bn) Real GDP growth (%) Expenditure on GDP (% real change) Private consumption Government consumption Gross fixed investment Exports of goods & services Imports of goods & services Origin of GDP (% real change) Agriculture Industry Services Population and income Population (m) GDP per head (US$ at PPP) Recorded unemployment (av; %) Prices and financial indicators Exchange rate R:US$ (end-period) Consumer prices (end-period; %) Producer prices (av; %) Stock of money M1
2005
2006
2007
2008
2009
881.8 3.1
1,089.0 3.9
1,333.6 5.6
1,575.2 5.1
1,473.1 0.0
(% change) StockofmoneyM2(% change) Lending interest rate (av; %) Current account (US$ m) Trade balance Goods: exports fob Goods: imports fob Services balance Income balance Current transfers balance Current-account balance External debt (US$ m) International reserves (US$ m) Total international reserves Source: IMF, International FinancialStatistics.
19.5 55.4
18.9 50.8
18.6 43.7
17.3 47.3
12.5 45.0
53,799
85,839
180,334
193,784
210,123
Together with several smaller parties, four political parties stand out: Workers' Party (PT), Brazilian Social Democracy Party (PSDB), Brazilian Democratic Movement Party (PMDB), and Democrats (DEM). Almost all governmental and administrative functions are exercised by authorities and agencies affiliated to the Executive.
The form of government is that of a democratic republic, with a presidential system. The president is both head of state and head of government of the Union and is elected for a four-year term, with the possibility of re-election for a second successive term. The current president is Lus Incio Lula da Silva who was elected on October 27, 2002, and re-elected on October 29, 2006. The President appoints the Ministers of State, who assist in government. Legislative houses in each political entity are the main source of law in Brazil. The National Congress is the Federation's\ bicameral legislature, consisting of the Chamber of Deputies and the Federal Senate. Judiciary authorities exercise jurisdictional duties almost exclusively.
Foreign relations
Brazil has traditionally been a leader in the inter-American community and played an important role in collective security efforts, as well as in economic cooperation in the Western Hemisphere. Brazil supported the Allies in both World Wars. During World War II, its expeditionary force in Italy played a key role in the Allied victory at Monte Castello. It is a member of the Organization of American States (OAS) and a party to the Inter-American Treaty
of Reciprocal Assistance (Rio Treaty). Recently, Brazil has given high priority to expanding relations with its South American neighbors and is a founding member of the Latin American Integration Association (ALADI), the Union of South American Nations (UNASUL) created in June 2004, and Mercosul, a customs union between Argentina, Uruguay, Paraguay, and Brazil, with Chile, Bolivia, Peru, Colombia, and Ecuador as associate members; Venezuela's full membership is pending.
Brazil is a charter member of the United Nations and participates in its specialized agencies. It has contributed troops to UN peacekeeping efforts in the Middle East, the former Belgian Congo, Cyprus, Mozambique, Angola, East Timor, and most recently Haiti. Brazil is currently leading the UN peacekeeping force in Haiti. Brazil served as a non-permanent member of the UN Security Council from 2004-2005. Prior to this, it had been a member of the UN Security Council eight times. Brazil is lobbying for a permanent position on the Counci As Brazil's domestic economy has grown and diversified, the country has become increasingly involved in international economic and trade policy discussions. For example, Brazil has been a leader of the G-20 group of nations and in 2009 became a creditor country to the International Monetary Fund (IMF). The U.S., Western Europe, and Japan are primary markets for Brazilian exports and sources of foreign lending and investment. China is a growing market for Brazilian exports. Brazil also has bolstered its commitment to nonproliferation through ratification of the nuclear Non-Proliferation Treaty (NPT), signing a full-scale nuclear safeguard agreement with the International Atomic Energy Agency (IAEA), acceding to the Treaty of Tlatelolco, and joining the Missile Technology Control Regime (MTCR) and the Nuclear Suppliers Group.
create their own laws than in the United States. For example, criminal and civil laws can only be voted by the federal bicameral Congress and are uniform throughout the country.
The states and the federal district may be grouped into regions: Northern, Northeast, Central- West, Southeast and Southern. The Brazilian regions are merely geographical, not political or administrative divisions, and they do not have any specific form of government. Although defined by law, Brazilian regions are useful mainly for statistical purposes, and also to define the application of federal funds in development projects.
Municipalities, as the states, have autonomous administrations, collect their own taxes and receive a share of taxes collected by the Union and state government. Each has a mayor and an elected legislative body, but no separate Court of Law. Indeed, a Court of Law organized by
the state can encompass many municipalities in a single justice administrative division called comarca (county).
Geography
Brazil occupies a large area along the eastern coast of South America and includes much of the continent's interior, sharing land borders with Uruguay to the south; Argentina and Paraguay to the southwest; Bolivia and Peru to the west; Colombia to the northwest; and Venezuela, Suriname, Guyana and the French overseas department of French Guiana to the north. It shares a border with every country in South America except for Ecuador and Chile. It also encompasses a number of oceanic archipelagos, such as Fernando de Noronha, Rocas Atoll, Saint Peter and Paul Rocks, and Trindade and Martim Vaz. Its size, relief, climate, and natural resources make Brazil geographically diverse.
Brazil is the fifth largest country in the world, after Russia, Canada, China and the United States, and third largest in the Americas.
Climate
The climate of Brazil comprises a wide range of weather conditions across a large area and varied topography, but most of the country is tropical. According to the Kppen system, Brazil hosts five major climatic subtypes: equatorial, tropical, semiarid, highland tropical, temperate, and subtropical. The different climatic conditions produce environments ranging from equatorial rainforests in the north and semiarid deserts in the northeast, to temperate coniferous forests in the south and tropical savannas in central Brazil. Many regions have starkly different microclimates.
The industry - from automobiles, steel and petrochemicals to computers, aircraft, and consumer durables - accounted for 30.8% of the gross domestic product. Industry, which is often technologically advanced, is highly concentrated in metropolitan So Paulo, Rio de Janeiro, Campinas, Porto Alegre, and Belo Horizonte.
Brazil is the world's tenth largest energy consumer with much of its energy coming from renewable sources, particularly hydroelectricity and ethanol; nonrenewable energy is mainly produced from oil and natural gas. A global power in agriculture and natural resources, Brazil experienced tremendous economic growth over the past three decades. It is expected to become a major oil producer and exporter, having recently made huge oil discoveries. The governmental agencies responsible for the energy policy are the Ministry of Mines and Energy, the National Council for Energy Policy, the National Agency of Petroleum, Natural Gas and Biofuels, and the National Agency of Electricity.
Transport
Brazil has a large and diverse transport network. Roads are the primary carriers of freight and passenger traffic. The road system totaled 1.98 million km (1.23 million mi) in 2002. The total of paved roads increased from 35,496 km (22,056 mi) in 1967 to 184,140 km (114,425 mi) in 2002.
There are about 2,500 airports in Brazil, including landing fields: the second largest number in the world, after the United States. So Paulo-Guarulhos International Airport, near So Paulo, is the largest and busiest airport, handling the vast majority of popular and commercial traffic of the country and connecting the city with virtually all major cities across the world.
Coastal shipping links widely separated parts of the country. Bolivia and Paraguay have been given free ports at Santos. Of the 36 deep-water ports, Santos, Itaja, Rio Grande, Paranagu, Rio de Janeiro, Sepetiba, Vitria, Suape, Manaus and So Francisco do Sul.
Demographics
The population of Brazil as recorded by the 2008 PNAD was approximately 190 million [193] (22.31 inhabitants per square kilometer), with a ratio of men to women. of 0.95:1and 83.75% of the population defined as urban. The population is heavily concentrated in the Southeastern (79.8 million inhabitants) and Northeastern (53.5 million inhabitants) regions, while the two most extensive regions, the Center-West and the North, which together make up 64.12% of the Brazilian territory, have a total of only 29.1 million inhabitants.
Population increased significantly between 1940 and 1970, due to a decline in the mortality rate, even though the birth rate underwent a slight decline. In the 1940s the annual population growth rate was 2.4%, rising to 3.0% in the 1950s and remaining at 2.9% in the 1960s, as life expectancy rose from 44 to 54 years and to 72.6 years in 2007. It has been steadily falling since the 1960s, from 3.04% per year between 1950-1960 to 1.05% in 2008 and is expected to fall to a negative value of 0.29% by 2050 thus completing the demographic transition.
In 2008, the illiteracy rate was 11.48% and among the youth (ages 1519) 1.74%. It was highest (20.30%) in the Northeast, which had a large proportion of rural poor. Illiteracy was high (24.18%) among the rural population and lower (9.05%) among the urban population. In 2006 nearly 50,000 people were murdered in Brasil. O DIA Online - Rio no mapa da morte! More than 500.000 people have been killed by firearms in Brazil between 1979 and 2003, according to the UN report.
The largest metropolitan areas in Brazil are So Paulo, Rio de Janeiro, and Belo Horizonte all in the Southeastern Region with 19.5, 11.5, and 5.1 million inhabitants respectively. Almost all of the state capitals are the largest cities in their states, except for Vitria, the capital of Esprito Santo, and Florianpolis, the capital of Santa Catarina. There are also non-capital metropolitan areas in the states of So Paulo (Campinas, Santos and the Paraba Valley), Minas Gerais (Steel Valley), Rio Grande do Sul (Sinos Valley), and Santa Catarina (Itaja Valley).
So Paulo is the largest city in Brazil and the world's 7th largest metropolitan area. The city is the capital of the state of So Paulo, the most populous Brazilian state. It is also the richest city in Brazil. The name of the city honors Saint Paul. So Paulo exerts strong regional influence in commerce and finance as well as arts and entertainment. So Paulo is considered an Alpha World City.
Many local companies are undervalued and in need of restructuring, capital and technology
y y y y y
Growth potential and consumer market Broad industrial base and infrastructure, and a diversified economy Creativity and flexibility of labor force, coupled with its competitive cost basis Abundant agricultural, mineral and energy resources and potential Established transportation networks (railways, highways, ports) and distribution channels in most industrialized areas
y y y
Privatization in late stages and follow-on transactions still in development Inflation under control in the last 10 years Increasing globalization and international trade, with Government policies favoring exports
y y y
Foreign investors are eligible for most available fiscal incentives Goodwill generally tax deductible New regulations favoring minority shareholders
Starting a Business
Procedures (number) Time (days) Cost (% of income per capita) Min. capital (% of income per capita) Procedures (number) Time (days) Cost (% of income per capita)
Employing Workers
Registering Property
Difficulty of redundancy index (010) Rigidity of employment index (0100) Redundancy costs (weeks of salary) Procedures (number) Time (days) Cost (% of property value)
0 46 46 14 42 2.7 3 5 23.7 59.2 6 7 3 5.3 10 2600 15.7 46.9 6.6 69.2 8 12 1540 7
Getting Credit
Protecting Investors
Strength of legal rights index (010) Depth of credit information index (0-6) Public registry coverage (% of adults) Private bureau coverage (% of adults) Extent of disclosure index (0-10) Extent of director liability index (0-10) Ease of shareholder suits index (010) Strength of investor protection index (0-10) Payments (number per year) Time (hours per year) Profit tax (%) Labor tax and contributions (%) Other taxes (%) Total tax rate (% profit)
Paying Taxes
Documents to export (number) Time to export (days) Cost to export (US$ per container) Documents to import (number)
Time to import (days) Cost to import (US$ per container) Enforcing Contracts Procedures (number) Time (days) Cost (% of claim) Closing a Business Recovery rate (cents on the dollar) Time (years) Cost (% of estate)
List of procedure
1. 2. 3. Check company name with State Commercial Registry Office Pay registration fees Register with the commercial board of the state where the main office is located and obtain identification number 4. Register for federal and state tax, obtain the CNPJ number, which also registers employees with the national institute of social security. 5. 6. 7. Confirm Taxpayer Enrollment Receive state tax inspection Get the authorization to print receipts/invoices from the Secretaria da Fazenda Estadual 8. 9. Register with the municipap Taxpayers Registry Pay TFE to the Municipal Taxpayers Registry
10. Apply to the municipality for an operation permit 11. Register the employees in the social integration program 12. Open a special fund for unemployment account in the bank 13. Notify the ministry of Labor 14. Registration with the Patronal union and with the employee union
PESTLE Analysis
PESTLE analysis is a useful tool for understanding the big picture of the environment, in which you are operating, and the opportunities and threats that lie within it. By understanding the environment in which you operate (external to your company or department), you can take advantage of the opportunities and minimize the threats. Specifically the PEST or PESTLE analysis is a useful tool for understanding risks associated with market growth or decline, and as such the position, potential and direction for a business or organization. The PESTLE Analysis is often used as a generic 'orientation' tool, finding out where an organization or product is in the context of what is happening outsides that will at some point effect what is happening inside an organization. A PESTLE analysis is a business measurement tool, looking at factors external to the organization. It is often used within a strategic SWOT analysis (Strengths, Weaknesses, Opportunities and Threats analysis). The PESTLE subject should be a clear definition of the market being addressed, which might be from any of the following standpoints: y y y y y y y y A company looking at its market A product looking at its market A brand in relation to its market A local business unit or function in a business A strategic option, such as entering a new market or launching a new product A potential acquisition A potential partnership An investment opportunity
The President heads the executive branch. Under the President are a number of executive departments, the heads of which are appointed and are known collectively as the cabinet. Unlike those in many parliamentary democracies, its members need not be members of the legislative. Besides the executive departments, there are a number of independent agencies many of which are regulatory. Legislative power is exerted by Congress consisting of a Senate and house of Representatives. There are 81 senators, three from each state and the federal District of Brasila. The total membership of the House is 513, the number of representatives from each state depending on its population. Voting is compulsory at the age of 18 but 16 and 17 year-olds, 70 years or older and illiterate can opt to vote. The judicial branch consists of a system of federal, state and local courts throughout the country, headed by the Federal Supreme Court. Change in Government. Brazil has presidential election scheduled for October 2010. During election years, fiscal spending tends to increase as incumbents attempt to create temporary prosperity. As indicated above, increase in fiscal spending are consistent with the appropriate financial policy and should not adversely affect the economy. The two term president, Luiz Incio of the leftest Partido do Trablhadores (PT) party has adopted a conservative economic policy that has allowed Brazil to continue its growth run for his two terms. While the global economic downturn hit Brazil at the turn of the year, the economy has shown clear signs of recovery over 2009, bolstering the incumbent. The leading centrist opposition party Partio da Social Democracia Brasiliera (PSDB) will run a close challenge that some experts predict will result in a runoff election. The PSDB also supports a conservative economic policy. The elections should not pose a significant shift in government economic policy. Lula Administration Focus Areas y Social: Agriculture Reform, Hunger, Cities, Racial (quotas) public service / universities/ courts y Finance: Inflation, Trade Balance, Tax interest rates, Economical growth, No privatizations
y y Law
Brazilian law is based on Roman-Germanic traditions and civil law concepts prevail over common law practice. Most of Brazilian law is codified, although non-codified statutes also represent a substantial part, playing a complementary role. Court decisions set out interpretive guidelines; however, they are seldom binding on other specific cases. Doctrinal works and the works of academic jurists have strong influence in law creation and in law cases.
of the worst performers, falling 59.1% year-on-year. In January 2009, however, the vehicle industry saw a near doubling of output compared to December 2008. While in 2007 Brazil obtained a current account surplus of $1.55 billion (0.12% of GDP), in 2008 it registered its first current account deficit in six years, due to a lower trade surplus and increased profit repatriations by foreign firms. Brazil received an International Monetary Fund rescue package in mid-2002 of $30.4 billion, then a record sum. Brazil's central bank paid back the IMF loan in 2005, although it was not due to be repaid until 2006. One of the issues the Central Bank of Brazil recently dealt with was an excess of speculative short-term capital inflows to the country, which may have contributed to a fall in the value of the U.S. dollar against the real during that period. Nonetheless, foreign direct investment (FDI), related to long-term, less speculative investment in production, is estimated to be $193.8 billion for 2007. Inflation monitoring and control currently plays a major part in the Central bank's role of setting out short-term interest rates as a monetary policy measure. Key industries Key industries are textiles, shoes, chemicals, aviation, cement, agriculture, motor vehicles and parts, other machinery and equipment. Major export products include aircraft, coffee, vehicles, soybean, iron ore, orange juice, steel, textiles, footwear and electrical equipment. FDI Brazil is generally open to and encourages foreign investment. Brazil is the largest recipient of foreign direct investment (FDI) in Latin America, and the United States is traditionally the number one foreign investor in Brazil. Since domestic savings is not sufficient to sustain longterm high growth rates, Brazil must continue to attract FDI. In order to attract increasing levels of FDI, many business groups and international organizations have highlighted the need for Brazil to improve its regulatory environment for investments and to simplify the tax code. Brazil does not have a bilateral tax or investment treaty with the United States. Legislation promoting public-private partnerships, a key effort to attract private investment to infrastructure, was passed in 2004. In 2007, the Government of Brazil initiated an ambitious infrastructure development program, known as the Growth Acceleration Program (PAC), to address the countrys significant road, rail, energy supply, and other infrastructure needs.
Expressionism, Cubism, Surrealism and Abstractionism. Brazilian cinema dates back to the birth of the medium in the late 19th century and has gained a new level of international acclaim in recent years. Language The official language of Brazil is Portuguese which is spoken by almost all of the population and is virtually the only language used in newspapers, radio, television, and for business and administrative purposes. The exception to this is in the municipality of So Gabriel da Cachoeira where Nheengatu, an indigenous language of South America, has been granted co-official status with Portuguese. Brazil is the only Portuguese-speaking nation in the Americas, making the language an important part of Brazilian national identity and giving it a national culture distinct from those of its Spanish-speaking neighbors. Brazilian Portuguese has had its own development, influenced by the Amerindian and African languages. As a result, the language is somewhat different, mostly in phonology, from the language of Portugal and other Portuguese-speaking countries. These differences are comparable to those between American and British English. In 2008, the Community of Portuguese Language Countries (CPLP), which included representatives from all countries with Portuguese as the official language, reached an agreement on the reform of Portuguese into one international language, as opposed to two diverged dialects of the same language. All CPLP countries were given from 2009 until 2014 to adjust to the necessary changes.
General Attitude Brazilians are warm, fun-loving, and free-spirited. They are also outgoing and enjoy being around others. At the same time, they are hardworking. Brazilians are proud of their country's natural resources and diverse culture. One point of pride is the Brazilian waytheir ability to find creative ways around seemingly insurmountable problems. Brazilians often are opinionated and will argue for their convictions with vigor. In spite of economic difficulties, most Brazilians are hopeful about their country's future.
Personal Appearance In general, Brazilians are fashionable and like to dress according to the latest styles. People in urban areas like to wear brand-name clothing. People in the warmest and most humid regions dress more casually, and colors are lighter and brighter year-round. In rural regions, more traditional clothing is common, especially among the native peoples.
Brazil IT market revenues generated by services is high at around 38%, which corresponds more to developed market levels.
R&D
Most of Brazil's research and development activities take place in its main public universities. Brazil, in particular, is an interesting country to consider, as scientific growth is in the beginning stages and offers tremendous future potential. Brazils GDP declined in 2009 by 0.7%, with an equal drop in its R&D investment for that year. Its GDP and R&D are both expected to increase in 2010 by about 3.5%, to $2,048 billion and $18.637 billion respectively, from its 2009 levels. Brazils R&D as a share of its GDP is about 0.91%. Brazils share of the worlds 7.1 million researchers increased from 1.2% in 2002 to 1.7% in 2007. According to UNESCO, Brazil has about 625 researchers for every million citizens of Brazil. So Brazil has great potential in growing the number of scientific papers its researchers publish, but is starting from a relatively low base.
Government and is directly elected by the citizens. The Legislative, embedded in the form of National Congress and consists of two houses: The Chamber of Deputies (lower house) and the Federal Senate (upper house), both constituted by representatives who are elected by the citizens. The Judicial powers are vested upon the Federal Supreme Court, the Superior Court of Justice, the Regional Federal Courts and Federal Judges. There are also specialized courts to deal with electoral, labor and military disputes. The Judiciary is organized into federal and state branches. Municipalities do not have their own justice systems, and must, therefore, resort to state or federal justice systems, depending on the nature of the case. The judicial system consists of several courts. The apex is the Federal Supreme Court and is the guardian of the Constitution. Among other duties, it has exclusive jurisdiction to: (i) declare federal or state laws unconstitutional; (ii) order extradition requests from foreign States; and (iii) rule over cases decided in sole instance courts, where the challenged decision may violate the Constitution. Court and justice The Superior Court of Justice is responsible for upholding federal legislation and treaties. The five Regional Federal Courts, have constitutional jurisdiction on cases involving appeals towards the decision ruled by federal judges, and are also responsible for cases of national interest and crimes foreseen in international pacts, among other duties. The jurisdiction of the Federal Judges include: being responsible for hearing most disputes in which one of the parties is the Union (State); ruling on lawsuits between a foreign State or international organization and a municipality or a person residing in Brazil; and judging cases based on treaties or international agreements of the Union against a foreign State or international body. State-level justice in Brazil consists of state courts and judges. The states of Brazil organize their own judicial systems, with court jurisdiction defined in each state constitution, observing that their legal scope is limited by those that do not concern the federal judicial ordainment.
The Future It seems likely that deforestation will continue in the Brazil Amazon for the foreseeable future. This author personally expects at least half the Amazon to be converted for agriculture or otherwise degraded by 2050. While this is discouraging, there is hope that improved agricultural techniquesperhaps based on research into how pre-Colombian societies managed these forestscould maybe increase productivity on already affected areas and reduce the need for further forest clearing. It is important to recognize that Brazil is a sovereign state with its own rights to develop its economy. How it chooses to do so will likely be influenced by economic factors which may include how western countries value the services (especially climate moderation and biodiversity preservation) provided by forests. If Western countries begin to place greater value on these services, then the protection of Brazil's rainforests can likely be "purchased" via the open market. While right now the environment for such a scenario is not favorable, this author believes it will become more so in the next few years. Scientists will play an important role in disseminating the value of these forests to policymakers and the media.