Essay About Argentina Vs. Brazil And Graded Assignment

Argentina Vs. Brazil – Compare Sociological/economic Data
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As the biggest economy in South America, Brazil features a rapidly expanding middle class driven by large and well-developed agriculture, manufacturing, mining, and service sectors. After being hit hard by the global recession in 2008, Brazil was one of the first countries to show a strong recovery, seeing a 7.5% growth in GDP in 2010. Because it has a historically high interest rate, Brazil is a very attractive destination for foreign investors. Argentina’s economy has been hit hard by multiple crises in the 20th century, though there have been signs of economic growth in recent years. After a severe depression and political unrest, the Argentine economy was victim to an unprecedented bank run that resulted in over 50% of the population being considered under the poverty line. Argentina has a significantly smaller GDP when compared to Brazil (771 billion to 2.416 trillion), which are the 8th and 23rd biggest in the world. Argentina’s smaller economy is grower at a faster rate, however, with a 3.5% real growth rate compared to Brazil’s 2.3%.As a member of the BRIC nations (Brazil, Russia, India China), Brazil has much more economic potential than Argentina for moving up the global value chain. With an abundance of raw materials, low-wage workers, capable manufacturers and large domestic markets, Brazil has seen a large increase in their net exports greatly in the 21st century. Brazil’s “export profile” primarily deals with the production of relatively low-level materials, ie raw/slightly developed materials that are processed by other countries to turn into final goods. It is one of Brazil’s primary goals to increase the technological content of their exports (increasing value), and there has been noted progress in diversification, technological learning, and industrial upgrading. The exports of Argentina, like Brazil, are used primarily as intermediate products by other countries. Both countries have large amounts of natural resources, which are the first component on the GVC. Argentina also participates in a number of manufacturing GVCs related to food, chemicals, and transport equipment. Unlike Brazil, however, there has not been much evidence of a yearning to increase their technological output and industrial capacity to move up the global value chain, as they rely on entirely raw and natural exports more than Brazil. Industrial upgrading, which is roughly defined as the increase in productivity, product quality, and export performance among manufacturing firms, seems to be playing a larger role in the Brazilian economy than in the Argentinian one. With investment into the industrial capacity of Brazil in the hopes of rising up on the global value chain, they show a much higher level of ‘industrial upgrading’ than the relatively stagnant industry of Argentina’s raw material focused exportation.