PESTLE Analysis of Brazil
In this PESTLE Analysis of Brazil, you will realize that the PESTLE tool is very effective to run an entity including the country. Brazil is a South American country and one of the largest in Latin America. The Federative Republic of Brazil touches the border with every South American country except Ecuador and Chile. Brasilia is the capital city of Brazil. Sao Paulo is the largest city in the country. The total area of Brazil is 8.516 million km2 and its total population is 212.6 million (2020). In terms of area and size, it is the 5th largest country in the world. In terms of population, it is the 6th most populated country in the world.
Brazil is the home of various tribal nations. In 1500, Portuguese came and colonized the country. However, the country got independence in 1822. It became the Empire of Brazil. The country follows the presidential form of government and administration. From 1964 to 1985, a military dictator ruled the country. In 1988, the civilian government established the federal republic country.
In this article, we will conduct the PESTLE analysis of Brazil. This tool is really helpful in analyzing macro-environmental factors such as political, economic, social, technological, legal, and environmental. Hence, the impact of these factors is really huge on the country. Here’s the complete PESTLE analysis of Brazil,
Political Factors | PESTLE Analysis of Brazil
The country follows the federal republic democratic system of government. Brazil comprises federal districts and 26 states. The country falls under the types of middle income countries of the world. So, the country holds significant importance in international affairs. Moreover, it is worth mentioning that the country has the largest democracy in the world. It shows that its consumer markets are really huge. According to some experts, these indicators show that this country has various growth chances and potential. There is a chance that they can make a prominent position in the top 10 economies of the world.
The country has very friendly relations with neighbors such as the US, Venezuela, and Argentina. Moreover, Brazil has strong alliances and membership in some leading institutions like the UN, G20, IMF, World Bank, BRICS, Mercosul, Organization of Ibero-American States, Organization of Portuguese language countries, World Trade Organization, and more.
Like other South American countries, Brazil’s main issue is corruption. They have been facing this problem for several decades. However, government institutions are taking appropriate initiatives to remove the roots of corruption. Such initiatives and steps could decrease the level of corruption.
Economic Factors | PESTLE Analysis of Brazil
- Gross Domestic Product (GDP):
In 2020, the annual gross domestic product (GDP) of the country was 1.363 trillion dollars which is the 13th highest in the world. Its per capita income was 6450 dollars which is really low as compared to the other neighboring countries. In 2015, the country faced one of the most difficult economic recessions. It is still facing its perks in 2022. The recent pandemic of covid-19 has also affected the country’s economy very badly.
- Productive Industries:
When it comes to coffee-producing countries, Brazil falls under the category of the world’s top countries. The country produced 32.99 million bags of coffee during the period of 2021 to 2022. During 2016-2017, the country produced a record-breaking 55 million bags of coffee. When it comes to the power industry, sugar is the most powerful one. Brazil exports sugar and coffee to more than 100 countries. These economic indicators are really bright for the country’s financial condition.
- Imports and Exports:
Cars, crude petroleum, soybeans, iron ore, and raw sugar are some of the country’s top exports. So, the country exports these things to the USA, China, Argentina, Germany, and Netherland. Moreover, Medicines, medicine packaging, refined petroleum, cars, and integrated circuits are the main imports of the country. So, The country imports these products from China, the USA, Germany, South Korea, and Argentina.
- Foreign Direct Investment (FDI):
Several international countries are investing in Brazil. Being a member of BRICS, it receives foreign direct investment from South Africa, China, Brazil, Russia, and India. The purpose of this alliance is to enhance the level of foreign direct investment in the country.
- Unemployment and Taxes:
In 2020, the unemployment rate was above 13 percent of Brazil. It has climbed due to the perks of covid-19. The tax rate was over 28 percent in 2021 which is really low. These factors show that the country is going in the wrong direction.
Social Factors | PESTLE Analysis of Brazil
The total population of Brazil in 2020 was 212.6 million. The main religion of the country is Christianity and more than 89 percent follow the religion. The remaining 11 percent are minorities. The official language of the country is Portuguese, but they also speak English and Spanish. In short, Brazil is one of the most beautiful countries in the world. They are football lovers and their team and players are highly famous in the world.
- Crime and Poverty:
In the recent few years, the country has evolved economically. The government is trying to remove the poverty level. More than 10 percent of the population of the country is living under poverty. The gap between the poor and rich has enlarged in the past few years. Just because of this, the crime rate is going up in the country. Some of its cities are very bad-reputed due to the violent crime rate.
- Social Problems:
Currently, the country is dealing with several social challenges such as poor education, poverty, crime, child labor, bad housing, and a poor healthcare system. The overall social condition of the country is pathetic. Drug dealing, prostitution, and other similar things are very common. Gender bias and race is a common things.
When it comes to fashion, Brazilians are very fashion-loving and modern. Middle-class families are growing in the country. Moreover, they love branded and luxury clothes and lifestyle products. Football and baseball are very popular in the country.
Technological Factors | PESTLE Analysis of Brazil
- Social Media:
Brazil is growing in the tech sector such as software, web development, and mobile. The Brazilian people love to use mobile phones and the internet. They are actively present on social media sites like Facebook, Instagram, YouTube, Twitter, and LinkedIn. The largest city in the country is Sao Paulo.
- ICT Growth:
When it comes to information and communication technology (ICT), Brazil falls under the category of the world’s leading countries. They love to communicate with each other using the latest technologies and devices. Due to this reason, many tech multinational companies are investing in the country. On the other hand, some of its areas still don’t have access to the internet and technology.
Legal Factors | PESTLE Analysis of Brazil
The legal system of the country promotes foreign investment and businesses. However, the employment rate is a bit low in the country. However, multinational companies can target the country to give employment chances. On the other hand, the country does not allow nuclear energy companies, postal services, and security agencies to work in the country.
Environmental Factors | PESTLE Analysis of Brazil
- Environmental Challenges:
The country is facing some of the worst environmental challenges like air pollution, deforestation, smuggling, illegal poaching, oil spills, water pollution, and land degradation. The government and individuals are taking aggressive steps to address these environmental challenges.
- Tourism Industry:
Brazil is a beautiful country and it attracts millions of visitors every year across the globe. They are strengthening the country’s economy. The country has more than 2000 beaches, rainforests, landscapes, the Amazon River, Iguacu Falls, and 62 National Parks.
Final Thoughts | PESTLE Analysis of Brazil
After this careful study, we have realized Brazil is one of the developing countries in the world. However, the country is facing some serious problems like crime rate, poverty, unemployment, environmental challenges, and other issues. The country has the potential and resources to become a leader.
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