Industrial policy and technology in Brazil

Sep 2, 2013 by admin    No Comments    Posted under: Economy

On Monday (08/26), there was held a seminar called “Reindustrialization of Brazil”, with the presence of trade unionists, economists and a representative of the Government at the headquarters of the Federation of Industries of the state of São Paulo. The underlying theme was “industrial and technological policy instruments to encourage the reindustrialization of Brazil”.

According to Antonio Fernandes dos Santos, representative of the Brazilian Central Trade Unions, education is one of the most important policies for the process of reindustrialization.

“We need less bachelors and more technical graduates. Our education system today does not reflect the reality and needs of the country”, said the trade unionist. “Countries that have advanced in terms of innovation and technology have education as their primary concern”. The issues of ownership and financing of innovation are other key points, according to Santos.

“It is not possible that Brazil has less than 0.5% of GDP invested in innovation and new product development. Our biggest struggle is with the renters who consume 44% of the country’s budget”. Following the same line, Claudio Prado, representative of the Union of metal workers of Sao Paulo, spoke about the need to improve education and reduce the deficit of manpower. His presentation also focused on the defense of small and medium-sized enterprises.

“If the Government stipulated that consumption would be its gist, we have to develop the supply chain as a whole, not just give priority to those who are biggest”, he argued. “Five points are fundamental to the advancement of our industry: professional qualification, improvement of labor relations, densification of the chain, tax justice, and a policy of nationalization of imports”, completed Prado.

Showing concern over the current foreign exchange situation, José Roberto Mendonça de Barros from MB Associados, stated that the devaluation demonstrates, once again, the need to revise the issue of Brazilian tariff system.

“This structure has been a subject of many small and localized interventions in recent years and overall, its aim to protect the basic industrial inputs that worked for some years has been lost”, said Mendonça de Barros. Further he considers “indispensable” the review of the protection of raw materials and basic industrial inputs.

“Public spending” was the central theme of the lecture of Mansueto de Almeida from the Institute of Applied Economic Research (IPEA). “We all agree that the Brazilian Government levies a lot of taxes and gives very little in return in terms of quality of provided services. However, when we start to look at the structure of public spending in Brazil and ask what to cut, nobody knows”.

Another area of concern, according to Almeida, is that Brazil provides subsidized loans to large companies and does not support small and medium-sized companies and it is still discussing the issue of infrastructure, an old agenda, instead of investing in innovation. “If we want to encourage innovation in Brazil, we have to change the public programs and be willing to spend money. We are in the 21^st. century with the agenda of the 20^th. century”.

Maria Luisa Campos Machado Leal, from the Brazilian Ministry of Development, Industry and Foreign Trade, brought the standpoint of the Federal Government. “Having a reasonable situation of interest rates, as well as the exchange rate, allows us to use the industrial policy instruments the way it has to be, to increase productivity, which is what will guarantee the social development”.

According to her, the Government believes that it is learning and advancing in the country’s industrial policy. “We seek to innovate not only in industry, but also in the public sector, in a coordinated and productive manner. And we hope, that things we have done will bring a result that is each time bigger”.

Source: Fiesp’s Indusnet Agency