Economic history of Brazil

The economic history of Brazil covers various economic events and traces the changes in the Brazilian economy over the course of the history of Brazil. Portugal, which first colonized the area in the 16th century, enforced a colonial pact with Brazil, an imperial mercantile policy, which drove development for the subsequent three centuries.^[1] Independence was achieved in 1822.^[1] Slavery was fully abolished in 1888.^[1] Important structural transformations began in the 1930s, when important steps were taken to change Brazil into a modern, industrialized economy.^[1]

A socioeconomic transformation took place rapidly after World War II.^[1] In the 1940s, only 31.3% of Brazil's 41.2 million inhabitants resided in towns and cities; by 1991, of the country's 146.9 million inhabitants 75.5% lived in cities, and Brazil had two of the world's largest metropolitan centers: São Paulo and Rio de Janeiro.^[1] The share of the primary sector in the gross national product declined from 28% in 1947 to 11% in 1992.^[1] In the same 1947–92 period, the contribution of industry to GNP increased from less than 20–39%.^[1] The industrial sector produces a wide range of products for the domestic market and for export, including consumer goods, intermediate goods, and capital goods.^[1]

Through the 1980s and 1990s, the Brazilian economy suffered from rampant inflation that subdued economic growth. After several failed economic initiatives created by the government, in 1994 the Plano Real was introduced. This plan brought stability and enabled Brazil to sustain economic growth over that of the global economy through the coming decade. Despite this rapid development the country still suffers from high levels of corruption, violent crime, functional illiteracy and poverty.