Download Region 1 : Urban –Industrial complex (industrial triangle

Brazil’s Economic Cycles
The economic cycles are all linked to a single primary commodity. Each begins with
a rapid rise & boom conditions, and then ends in sudden decline & abandonment.
The cycles show a succession of lead regions & primary exports through time.
Brazil wood cycle
Portuguese traders came for Brazil wood. It grew in a coastal belt Sao Paulo to
Receife. The wood was exchanged for European items such as knives & pans. It
declined as the resource became scarcer.
Sugar Cane Cycle
Originally this cycle began in the SE (16th century), but then became concentrated in a
narrow coastal belt in the NE. It was based on slave labour (African slaves), as the
Amerindians lost their vigour working or died from European diseases. Colonial
plantations were developed (first evidence of a divided society). In the 17th century
the whole of the Brazilian economy revolved around sugar, with the capital being
based in the NE, Salvador. However, the economy declined around 1750, with
competition from other tropical areas.
Mineral Cycle
Whole economy moved from the NE to the SE & Centre West from 1698. This
movement was due to the discovery of gold & diamonds. Whole plantation families
moved with their slaves to the mineral zones. By 1750 the minerals were scarce and
thus the cycle was in decline. Longer lasting was cattle which started at the same
time.
Coffee Cycle
This was a significant cycle as it led to a strong concentration of capital, again in the
SE. At the same time the Amazon region experienced a rubber cycle, with rubber
tapping beginning, due to European demand. This ended when tree seeds were stolen
and planted in SE Asia where it was cheaper.
Manufacturing cycle
This is different to the other cycles, as it has a wider base and does not focus on one
material. It is also constantly changing with new products being demanded.
The boom developed from the coffee boom, as coffee merchants invested in other
industries – led to the commercial growth of Sao Paulo.
Myrdal’s core & periphery theory can be reasonably applied to the economic history
of Brazil, which was dominated by a series of economic cycles, based on raw material
exploitation.
Core &Periphery (SE the Core & NE the Periphery)
The SE benefited from spatial flows of raw materials, capital, labour ( the latter 2
from aboard as well as internal sources). The region grew rapidly due to cumulative
causation, allied to negative backwash effect on periphery – widening disparities.
More recently some parts of the periphery have benefited from the spread effect of the
core – could be due to market forces or regional economic policies. The South has
been the most important recipient of spread effects from the SE, but parts of the centre
west have benefited too.
Intra- regional disparities exist; for example, agricultural areas of the Sierras are some
of Brazil’s poorest (SE); shanty towns in Rio (SE); wealthy cities of Receife &
Salvador (NE).
Region 1 : Urban –Industrial complex (industrial triangle + southern outliers)
Region 2: Agro-industrial belt; commercial agriculture controlled by capitalist firms.
Region 3: Agro-mercantile belt; backward but local emplacements by state or
privately where regional policies are favourable.
Region 4: The Grand Frontier; area beyond which little capital is used, but has future
potential.
Advantages of the SE
*Climate – attractive warm temperature with adequate rainfall for agriculture,
industry & settlement.
*Minerals – large deposits of iron ore, manganese ad bauxite. Gold is still mined.
*Energy – focus on HEP on plateau rim; nuclear near Rio; biomass; offshore oil &
gas.
*Transport – Main airports & sea ports.
*Agriculture – major world region for coffee. Also important for beef, rice, cacao,
sugar cane & fruit.
*Labour – greatest population density. Highest education & skills levels in the
country.
*MNCs – Most located in SE. The region has grown rapidly through cumulative
causation.
*Finance – Sao Paulo biggest financial centre in South America.
*Innovation – centre of R&D
*Government Policy- Investment capital & managerial power was centred in the SE
in the 50s & 60s. Now trying to decentralise.
*The Industrial dynamo of Brazil.
*Manufacturing industry in Brazil is heavily concentrated in the SE, which is
comprised of 4 states, Sao Paulo, Rio de Janeiro, Minas Gerais, Espirito Santo.
*The Golden Triangle – Rio, Sao Paulo, Belo Horizonte.
*The region has the highest average earnings.
*The industrial Core – wide ranging, with steel being the leading industry and thus
car manufacturing. Sao Paulo being the main industrial city.
* Belo Horizonte is only second to Sao Paulo as an industrial centre. It lies at the
centre of the rich mining and agricultural hinterland, the so-called ‘Mineral Triangle’,
that has made the state of Minas Gerais, an economic powerhouse.
*More than 53% of al industries that invest in R&D are located in Sao Paulo. The
proximity of Sao Paulo’s three public universities and the principal research centres
has facilitated a steady exchange of ideas & information.
The NE
The NE has a very dry climate – hazardous due to droughts.
The Rainy season lasts 4-6 months, but sometimes this fails and it is dry for
18months.
The Coastal strip of the NE is less hostile, with clay soils. Today you will find the
major cities & high density rural populations in this strip.
The NE is seen as a conflict region, which reflects the colonial times, where there was
a highly divided society, based on slaves. After, divisions existed between wealthy
landowners and the poor. The focus of the rebellions changes from time to time, but
tends to centre on ownership & control of the land.
1992 – Food riots in Pernambucco, as crops were lost in droughts. Market was
ransacked by starving mobs.
The state government has been forced to draw up regional policies to help the poor of
the NE.
The NE is one of the poorest regions in the world and the most dense. Per capita
income is half the national average. Extreme poverty exists in this region due to the
droughts.
The NE experiences many droughts, which is surprising, as it has one of the largest
rivers – The Sao Francisco. The problem is distribution, not supply, as the region has
one of the biggest reserves of water. The killer is the political use made out of it by
landowners & politicians. The politicians used to demand people’s votes in exchange
for water or jobs. Irrigation could redeem the area.
Unfortunately, any aid given to the NE gets lost in leaky political plumbing and any
aid given direct to farmers is lost as many of them do not have land rights.
In the NE a piece of land the size of Britain is slowly turning into a desert.
The shoe industry has been traditionally based in the SE. But now shoe companies
are beginning to shift production to the NE, where wages are lower and government
grants are available. The country’s biggest shoemaker, Gendene, has already spent
$100mn on 4 factories in Ceara state.
Other Regions
The Amazon
The Amazon River drains an area the size of the USA. Marajo, the island in the
mouth of the river, is as large as Denmark.
200,000 indigenous people live in the Amazon and 17mn Brazilians live in its towns
and cities ( Manaus & Belem – 1mn each).
1978-88 annual deforestation – 21,000km². It could be seen from outer space.
The cycle of development, began in the Amazon in 1964, when the military decided
to integrate it with the rest of Brazil & provide access to the mineral deposits, which
had been discovered. Work began on roads, dams and a free trade zone was set up in
Manaus. This was all subsidised by the government and WB loans. Throughout all
this development, the indigenous people were ignored. The government regarded the
rainforest region as an asset to be exploited and ‘developed’ rather than sustainably
managed.
Negative impacts on the Amazon include: soil exhaustion & erosion; reduction in
rainfall; rise in CO²; fall in O²; death of the indigenous.
Amazonia is difficult to settle in, with its infertile soils. The River Amazon has not
provided ready access into the heart of the rainforest as rapids cause problems for
large vessels & there are enormous floods which cause changes in its levels.
Regional development in the east Amazon is based on minerals (Grand Carajas
project – Iron ore). However, this has led to massive deforestation – charcoal for
smelting.
The Transamazonian highway was built in the 1970s and runs from E Peru to the NE.
It was built in efforts to settle 1,000 of migrants out of the NE into the rainforest. The
results of this were poor, as the settlements were not good and also the land makes
poor farmland. Sadly logging & slash & burn increased around the highway.
The greatest threat to the Amazon is advanced clearing for cattle ranches, which has
been encouraged by government grants ( one ranch – 100,000ha).
Centre West
The natural region of Cerrados – savannah plains of central Brazil.
Plateaux always had poor soils & few resources. Once explored for minerals, but then
abandoned. Cattle ranching has been the main industry until recently.
Today the Soya bean is the commercial crop of the centre west. Early expansion was
due to government stimuli, but today this is not the case – it is near the frontier & has
relatively cheap land.
Solutions to Inequalities
Four Year Plan 1996-1999
This plan aims to remove regional inequalities.
1. North South railway to be created.
2. West – construction of road & rail bridge over the Parana river, which will
provide a link to the Sao Paulo rail network.
3. Invest in water sources of the NE – 19 irrigation projects, 4 dams.
4. Rio – Port & teleport to be built in order to improve the economy.
5. Regional tourism projects – modernise existing airports.
The WB and the G7 have pledged $270mn to Conserve the Rainforest & there are 400
Amazon NGOs. An organisation called SIVAM has been set up, which surveys the
rainforest electronically, through satellites, by aircraft & grand radar.
SUDENE has been set up reduce socio-economic gap between the NE and the rest of
the country. It coordinates federal investments in the region and improves the areas
resistance to drought.
A NE Pact was set in 1996. This pact aims to: consolidate the economic base & invest
in steel production, oil refining & car manufacturing; modernise agriculture; utilise
reservoirs for aquaculture; expand tourism; improve the infrastructure; improve
training & technological development; expand health programmes.
Examples of programmes include: NE fruit growing development programme ( aims
to turn NE into virtual California, by installing irrigation near main rivers); Attracting
FDI ( State of Marannao is trying to attract Taiwanese companies, with is cheap land
& labour, abundance of raw materials & close proximity to US markets)