Brazilian Economic Crisis- Fahad

Brazil is currently experiencing an acute economic crisis that continues to ravage its prospects for a strong and stable economy. The crisis presents numerous challenges to poor Brazilians who struggle for survival. The crisis has worsened because of economic policies put in place by the government and ratified by the International Monetary Fund and the United States’ authorities (Brainard). The crisis continues to generate international concern, especially from international press and economic observers (Brainard). Many international powers viewed Brazil as an emerging economic powerhouse. However, the current economic crisis has lowered the prospects of Brazil’s rise to economic supremacy. The crisis resulted from economic policies enacted by president Cardoso during his re-election campaigns (Cohen ). Attempts to diffuse the crisis, supported by international monetary institutions, have failed. Experts have tried synchronising the local currency with the American currency. This attempt has failed to generate expected results (Cohen). This aimed to increase the inflow of foreign exchange with a view to collect sufficient reserves to sustain the exchange rate. This strategy has produced unsatisfactory results. Consequently, citizens no longer believe in the government’s ability to manage the economy (Nanto). The current economic down turn is attributed to historical practices that continue to have negative effects on the country’s economy. Analysts believe that political patronage and interference are key contributors to the current economic crisis (Nanto)

Works Cited
Brainard, Lael. Brazil as an Economic Superpower: Understanding Brazils Changing
Role in the Global Economy. London: Brookings Press, 2012. Print.

Cohen, Michael. The Global Economic Crisis in Latin America: Impacts and
Responses. Newyork: Routledge, 2012. Print.

Nanto, Dick. Global Financial Crisis: Analysis and Policy Implications. London:
DIANE Publishing, 2010. Print.