As a new year approaches and after a year in which Brazil has reassumed a more relevant position on the international stage, there is a window of opportunity for reforms that will shape Brazil’s development in the coming decades. This is what the report “Brazil of the Future: Towards Productivity, Inclusion, and Sustainability,” published by the World Bank, explores, adopting a long-term perspective on Brazil’s development, discussing how prudent actions today can generate opportunities for a more prosperous, inclusive, and sustainable society in the next 20 years.
The authors argue that for Brazil to succeed in building on past achievements and facing future challenges, it needs to enter a virtuous cycle of productivity, inclusion, and sustainability. There are still many distortions in the Brazilian economy that undermine productivity.
“Unlocking economic potential will generate aspirations, the desire to plan, and the propensity to save and invest to acquire the skills needed for the future. Better education, especially for the underserved poor, will promote economic growth while improving access to better jobs. Opening markets will provide new opportunities for smaller businesses and lower prices for all. There is a virtuous cycle between productivity and inclusion, which also includes sustainability. A more productive economy uses fewer resources. In Brazil’s case, this implies less deforestation, the country’s main contribution to climate change. Less deforestation, in turn, is a critical foundation for Brazil to protect its economy, which critically depends on the ecosystem services provided by the country’s forests, especially the Amazon rainforest,” states the report.
For the World Bank, with the right reforms, Brazil can become an economic powerhouse that offers opportunities for all.
“By reforming public education and providing Brazilian children with access to more and better education, the gains from technological change could be widely shared. Reforms in social protection could lead to better protection for those in need at much lower fiscal costs. A more efficient and progressive tax system could help raise the necessary revenues to invest more in Brazil’s future while reducing inequality. Changing labor taxes could help reduce the current incentives for employers to rely on more precarious forms of employment. Natural resources, such as forests, could become a sustainable basis for prosperity, and Brazil could once again become a leader in the fight against climate change. All of this would sustainably generate economic growth and the revenues needed to finance progress in a fiscally sustainable manner. Brazil could become a major exporter of green commodities and manufactured goods, benefiting from the high demand for green production worldwide. Its innovative green energy matrix, along with low land-use emissions, would make it highly productive and competitive in international markets. And Brazilians would become active and innovative players in international business and global supply chains, opening new possibilities for growth throughout the economy.”
Does it sound like a dream? According to the report, it is an achievable dream.
Source: World Bank