Risk analysis (Brazil) Research Paper Example | Topics and Well Written Essays - 2500 words

Risk analysis (Brazil) - Research Paper manikinThe official currency is the Real that divides into 100 Centavos. Moreover, the country pursues industrial and agricultural harvest-feast and development of its interior. This entails exploiting the across-the-board natural resources in the country and utilizing the large labor pool. Today, Brazil enjoys the top position as the star(p) stinting power and a regional leader in South America. In addition, the country conduct in the economic recovery efforts in the region. However, a wide gap in income distribution and crimes pillow greatest problems in Brazil. The Wall Street Journal reported on Brazils economic growth on for the second quarter of the year 2012. According to the article, Brazils Listless issue Continues, there is a continued slump in the countrys economy despite efforts by the government to salvage it. Government statistics show that there was slowed growth in the second quarter registered at 1.6%, much lower than th e projected value. Brazilian government implemented tax cuts, record interest point cuts and campaigned to weaken its currency in order to ignite more economic activities. However, these efforts did not increase the curtilage and the economy was still sluggish (Fick, Magalhaes and Lyons). The report further indicates that the country registered the fastest growth rate in the world during the global financial crisis in the recent years. As a result, numerous investors considered investing in Brazil due to the development leap. It also ge bed the hosting of two main global events namely the soccer World Cup in 2014 and 2016 Olympic Games. However, the optimism on the economy is slowly turning into apprehension. As a result, the current climate for multinational investment is marred with uneasiness. The investors appear unsure of the governments measures to stimulate the recovery of the domestic help markets. Moreover, Brazils economy has downshifted to slower growth with the debt c risis and unpredictable recovery efforts. The government predicted an economic growth of 4.5% that gave the investors confidence in the markets. This was due to the increase in spending on key infrastructure projects much(prenominal) as ports and river dams. However, the target growth was never achieved instead, the country recorded a growth of half the think rate (Fick, Magalhaes and Lyons). In a bid to stimulate further recovery and growth, the government through the telephone exchange bank of Brazil has lowered the interest rates by 5% to 7.5%. In addition, there are other announced programs meant to build projects to improve transport and communication to boost growth. Officials in the country darned the worlds slow economic growth for the countrys performance. Furthermore, the administration cites the investor attitude towards rising market countries as a cause for slowed growth in their economy. However, several present and projected macroeconomic variables affect the rec overy and growth of Brazils economy (Fick, Magalhaes and Lyons). The country improved its macroeconomic constancy through the creation of foreign reserves, and the reduction of debt profile through a shift in debt force towards the denominated and domestically held instruments. After the 2008 recession period, Brazil was the first emerging market to recover. The GDP growth reached 7.5% in the year 2010. This was registered as the highest growth rate for the past 25 years of the economy. However, the increase in ostentation led to a slowed growth in 2011