Brazil, Argentina Economic Report

First, Brazil, Argentina Summary Brazil is located in the eastern part of South America, Eastern Atlantic Ocean, with the exception of Chile and Ecuador, with all the bordering countries of South America. Brazil's land area of 8,547,000 square kilometers, accounting for South America with a total area of 46%, second only to Russia, Canada, China and the United States, the world's fifth-largest country, the largest in South America. Brazil have the best and most Latin American industrial system, economic strength among the first in Latin America. The economic structure close to the level of developed countries, output and employment services sector, with a population of over 50%. Brazil once in the history of a single agricultural economies, sugar, coffee and so on for their main cash crops. From the 50s of the last century, Brazil "import substitution" economic model, and a large number of relying on borrowing to obtain the economic take-off, with gross domestic product in 1968-1973 average annual growth rate of 10%, to create a "Brazilian miracle" and Preliminarily established a relatively complete industrial system. In the 1980s, Brazil is facing a serious debt crisis, plagued by high inflation and severe economic stagnation and even recession. 90 from the start, Brazil to export-oriented economy in transition mode. In 1994 the Government implemented a real plan, an effective solution to the problem of high inflation, on the basis of which had a macro-economic structural reform, vigorously promote privatization. In 1997, as a result of the Asian and Russian financial crisis, Brazil hampered economic development. In early 1999, the Brazilian financial market turbulence, the government was forced to give up in 1994 since the implementation of the fixed exchange rate system, the sharp currency depreciation in the economy has been hit. As the Brazilian government has implemented stringent fiscal adjustment measures to increase revenue and reduce expenditure, so that rapid economic growth on the road to recovery, economic growth in 2000 reached 4.46 percent, and inflation has been basically brought under control. In 2001, global economic recession, Argentina's economic crisis and domestic electricity crisis, the Palestinian economy growth rate dropped to 2-2.5%. Lula came to power in 2003 after the implementation of the balanced development, social justice and stability in economic policy, taxation and promote social welfare reform, increased social investment to address poverty, employment and other issues, the results. In recent years, Brazil has to rid itself of the financial crisis, the economic development of a stable, rapid export growth, inflation under control. In 2006, Brazil's gross domestic product of about 1 trillion dollars, more than South Korea, the world's 10th largest economy. At present, the stability of the financial situation in Brazil, the increase in the inflow of foreign capital, production resumed growth, improve the employment situation, to achieve moderate economic growth. Argentina is located in the south-eastern South America, covering an area of 2,780,000 square kilometers, second only to Brazil is South America's second-largest country. Argentina has South America is the most economically developed countries, their industry categories, developed agriculture and animal husbandry, known as "the world's granary and meat library." But in early 2001 after the financial crisis hit, the sharp currency depreciation in the severe recession of the national economy, social unrest plunged into intense, the evacuation of a large number of investors in Argentina. Suffered heavy losses after the financial crisis, Argentina began to reflect on the country's economic development model. Kirchner came to power after Argentina's economic policies have been adjusted to ensure the smooth functioning of the economy and the health of public finances has become the core of the government's economic policy, at the same time the Government has stepped up its financial markets and regulatory intervention. ? In recent years, the world economy to grow steadily in the international market on higher prices of primary products for the financial crisis in Argentina out of the predicament created a favorable external environment. 4 recent years, Argentina's GDP average growth rate of about 8%, among the highest in Latin America. Kirchner during the administration of the Afghan government to pursue sound fiscal policy, foreign trade surplus at a high, the ability to resist financial risks greatly enhanced, maintain a healthy macro-economic operation. During this period, the proportion of poor people in Argentina from 54% to 23.4% from 17.8% unemployment rate decreased to 8.2 percent, the salary level of funding each year to maintain double-digit growth. Argentina before the National Assembly also amended the relevant laws, tax cuts for low-income and accumulate wealth. On the one hand, these measures greatly alleviate the social conflicts, on the other hand, the growing strength of the middle class, for Argentina's economic development and social stability to create favorable conditions. Argentine First Lady Cristina in October last year, the presidential election to win big advantage, was elected president. Kirchner's government economic policies continued. In recent years, Argentina is still slowly emerging from the shadow of financial crisis, the rapid development of the economy onto a fast track. Second, Brazil, Argentina to monitor the price situation Brazil since 1945 to start the process of industrialization. During 1945-60, encountered serious inflation, the Brazilian government has been trying to use administrative measures to control prices. From 1945 to 1993 only, prices on many occasions by the national government regulation and administrative intervention. But each time found after the intervention price, although the emergence of short-term price drop and rebound in the near future, resulting in three or four decades in repeated many times inflation, a vicious cycle. In the face of this situation, Brazil will be opened in 1994 as imports of national policy. In a large number of inexpensive imported goods under the impact of that, in order to seek the survival of domestic commodity prices also decreased gradually formed a level playing field for a virtuous circle of the situation, stabilize domestic market prices. In addition, Brazil is also appropriate to adjust the import and export tariffs, exchange rates and interest rates and other economic means, so that the Brazilian inflation rate has stabilized at about 4% in order to fundamentally stabilize the price Brazil, so that the national economy onto a sustained Development. Brazil is a market-oriented economy, in addition to a small number of countries involved in the national economy and people's major commodities such as energy, transportation, pharmaceuticals and some food prices due to control by the state, most of the commodity prices are determined by the market. The main means of price control: energy, unity from state-owned enterprises - Brazilian oil company responsible for the planning, production, sales and pricing; subway, unified by the state-owned enterprises - Brazil Mass Transit Railway Corporation is responsible for the planning, management, is responsible for the development of prices and subsidies; public transport, national Every three years for open tender for the right to operate the line, determined to take the survival of the fittest Ventures, a private company to obtain the right to operate the line at the same time clearly in the contract price; Highway, the former state-owned highway through open tender to sell 25 years The right to operate, operation and management standards and prices were clearly in the contract; aviation, water transport through the competition to obtain the right to operate the route, the price determined by the market; drugs, the state of the national production of drugs commonly used to stabilize prices; on rice , Daily necessities such as milk, Suihangjiushi prices, but those who take low-income subsidies. Brazil is responsible for the management of prices is under the Ministry of Finance of Brazil's economic development and price office, the agency does not directly manage prices, but rather to investigate and control, and price subsidies. Monopoly on the sale of high-priced, low-price dumping, counterfeit and inferior, in violation of intellectual property rights, unified by the Consumers Association to address the economy or to the court by the prosecution CaseTrust, the court can be based on the seriousness of the parties to the imposition of fines, cancellation of the right to operate until Be held criminally responsible. Argentina is also to introduce a market economy country, the vast majority of commodity prices determined by the market, the Government does not intervene directly. However, a number of important commodity prices, when the abnormal fluctuations, often by increasing government subsidies to carry out control measures. In recent years, such as to curb the price rise, the Government has increased the food, public transport and services in areas such as subsidies. In the first quarter of this year, the Albanian government into the types of government subsidies to reach 4,588,000,000 pesos (1 peso 3.18 U.S. dollars), more than 132 percent increase over the same period last year. One for energy and food subsidies increase significantly, in the field of energy subsidies reach 2,548,000,000 pesos, an increase of 218 percent. In the first quarter at a time when Argentina's Southern Hemisphere summer, the peak period for electricity, power supply is very tight, government subsidies to increase efforts to ensure a normal supply of electricity. In addition, due to international market prices of agricultural products, in the first quarter of this year, the Albanian government food subsidies in the 4.3 billion pesos, is 3 times the same period last year. Argentina is currently lower than domestic food prices in the international market prices, which spread a large part of the product, the Albanian government to maintain domestic price stability, we must continue to increase food subsidies. In addition, the delegation of Brazil, Argentina between the two countries and protect the housing price research conducted focus. Brazil, Argentina is the private ownership of land, housing a full market price, the Government does not directly control prices, the only group to provide low-interest loans to low-income public housing building, the so-called "Singapore residential" to the gradual eradication of slums. At present, Brazil, Argentina ongoing slum upgrading is funded by the federal government, the city government in charge of the land, building infrastructure and undertake specific operations, and rely on local community management and slum families together to complete a comprehensive reform plan. ? Brazil for the federal government's national housing construction, there are three main sources of funding channels, one staff security fund, and the other is turned over to 3% of the enterprise fund and the third is from the construction budget. Argentina slum upgrading projects by governmental organizations, public bidding, building successful businesses, to give priority to low-income families to choose the local workforce to participate in construction projects, which can greatly increase their employment opportunities and improve revenue. Brazil slum upgrading the distribution of housing are two ways for the lowest-income families, the government provided free housing and free rent, utilities and so on all charges. For low-income families will have to pay low rent on a monthly basis and paid in full 17 years after the owner of the property. The national housing market trading, Brazil provides that if the property has been bought, lived in 5-10 years can be traded, all of the personal income, but the head of the family can no longer apply for a new public housing. Slum demolition reconstruction of the distribution of housing in general smaller area, is to meet the basic needs of living, population and family situation and inter-generational distribution. Argentina, the average floor area of 50 square meters to 70, at Room 000, Room 000, Room 000, and so on. Brazil's low-income housing in general use in the area of 50 square meters or so, for the lowest income families with housing in general in the 38 to 40 square meters. The private development of housing, in the general area of 70 to 160 square meters, the price of 140000-400000 Palestinian dollars (1 U.S. dollars or about 4 Pakistani currency). More high-end residential and about 400 square meters, the price of 2,000,000 yen around Pakistan. The Brazilian Government has drawn up a national housing plan, to plan for all residents to provide appropriate housing, and to encourage self-built housing residents. At the same time, to take discrimination, focusing on low-income families in subsidized policies for different income groups to provide housing loans. The annual income equivalent to 1-3 times the minimum income line of low-income, the lowest annual income equivalent to 3-6 times the revenue line of middle-income class, you can buy government investment in the construction of housing, and to achieve a minimum annual interest rate of 1% Long-term preferential loans, they buy houses and the price level is different. Third, the harvest and experience Through this visit, study to understand the South American country's market prices, an increase of knowledge, a wide field of vision, was inspired benefit. (A) of the Government in commodity prices, an important regulation mechanism of inspiration. The first is the introduction of competition in the market, breaking the monopoly price. Brazil, Argentina and China are developing countries, but between the two countries with a high degree of privatization, market economic system better, especially in terms of price regulation on maximizing the role of market mechanism. Will be opened as a national policy of Brazil, by opening the door to participate in international competition, domestic enterprises will be placed on the international market competitive environment, the survival of the fittest, and thus break the monopoly, lower prices and keep prices low. According to the Brazilian Association of Economists Punia, Brazil since 1994 to implement the open door policy, by reducing import tariffs, export proper control, such as adjusting interest rates means a substantial decline in domestic prices. For example, the telecommunications industry, operating exclusively in the past, loaded up the phone to a few thousand dollars, in Sao Paulo, Brazil's fastest-growing areas, the installation of a telephone to wait for two years. Now a phone call to the installed capacity, and also to avoid the initial installation fee; Another example is the automobile industry also has been a great opening. The second is to promote the development of production, means to be used with caution administrative intervention. Mr. Punia said that in Brazil in 1994 before the implementation of a number of interventions to suppress the price, just the opposite effect. Practice has shown that simply take administrative measures, not the development of production, restrictions are only temporary, and the inevitable price rebound. Argentina's domestic market more price regulation is to increase subsidies to promote the development of production. In the current international food prices against the background of the two basic food prices remain stable. China's current market price continued to rise, especially food prices higher, to prevent fast economic growth to overheating and prevent prices rising structural evolution of the obvious inflation this year to become China's macro-control priority and an important goal. In an important part of the goods and services to implement temporary price intervention measures at the same time, we must control the prices of the two countries learn from the experience and lessons focus on commodity-related production and supply, to intervene in the selection of varieties, production and marketing of the burden, promote Production increased supply as well as subsidies to support policy co-ordination should consider implementation of the joint, with a view to promoting a virtuous circle, and sustainable development.