It was not so long ago when Europe and USA were the “rescuers” of Latin America, Asia, India and Africa; now the roles have changed, and Europe looks forward to having financial support from Brazil, India, China, Russia, and South Africa.
It seems ironic that countries like Brazil and India are considering to lend a large amount of money to IMF, while their sore history with that institution is not far in the past; Brazil quit its debt with the IMF just six years ago.
The fact that Brazil, in 2005, paid off its debt with the IMF two years before it was due, does not mean that the country is free of external debt; the Brazilian external debt (public and private) is of € 227 billion (75% of the National Reserve) and the domestic debt of € 1,3 trillion (38,2% of the GIP). The numbers speak for themselves...
The Brazilian economy is growing remarkably fast, and the poverty in the country is decreasing; however, there is still a long way to go before the picture of extreme poverty is washed away. Today there are 16,2 million people living in extreme poverty in Brazil - from those 16,2 million Brazilian citizens, 4,8 million live with a monthly income equal to 0, and 11,4 million with a monthly income not higher than € 29.
"A rich country is a country without poverty" - this is the slogan of the Brazilian government for its project "Brasil sem miséria" (Brazil without misery). As we can see, there is still a great number of Brazilian citizens living in miserable conditions, and another large number living in extreme miserable conditions. With that, I can only conclude that, according to the words of the former and the actual president of Brazil, that country isn't rich...yet. I must admit that much has been done in that aspect, that the quality of life has been improved, but we mustn't pretend it's solved.
It would be a mistake, and above all, a disrespect towards those who have no conditions to feed and to dress their children properly, to offer financial help to Europe, to offer help to the Euro currency.
Poverty isn't the only problematic social issue which Brazil deals with; public health and analphabetism score extremely high as well. Public hospitals without proper equipments, medicaments and levels of professional staff, and even without the most basic needs as sheets and towels, make part of the lives of the 142.376.496 people in that country who do not have health insurance fundamentally more difficult.
What about education? Only 7% of the GIP goes to education. The complaints about the public education in Brazil are endless. They go from public school buildings in unbelievable unfavourable conditions to extremely low teachers' salary. The government doesn't invest enough money in education; even though the State has, without any doubt, the resources to improve the level of education in every region, and most importantly, to make sure that the teachers in Brazil start to get a decent salary.
Another area where Brazil could use its “spare” money is in sanitation. It would require about € 5 billion per year, during 20 consecutive years, to meet the deficit of sanitation in the country. Today, the federal government invests € 1,5 billion, from which half comes from private sanitation companies. The calculations were made by professor Wanderley da Silva Paganini, from the Environmental Health Department of the Faculty of Public Health of USP, based on preliminary data from the Census 2011, disclosed at the end of April by the Instituto Brasileiro de Geografia e Estatística (IBGE). For the specialist in sanitation, the 2011 Census figures reveal a "worrying" situation regarding the access to the collection of sewage system and water supply in the country.
With all those deficiencies, which affect the lives of millions of Brazilian citizens, it seems rather illogical that the government prefer to lend money to IMF instead of to improve the life of its own people. Isn't like Europe has no money, the money is there, billions of Euros in companies like Electrabel, Exxonmobil Petroleum & Chemical and Janssen Pharmaceutics in Belgium.
It makes no sense that while a company such as Exxonmobil Petroleum & Chemical makes a profit of € 4,7 billion in the year of 2010, pays only € 10,000 taxes. There are 50 companies in Belgium that enjoy the benefits of low, or zero taxes; with a total of € 27 billions profit and € 280 million as paid taxes.
The average worker in Belgium still pays high taxes though.
So yes, there is money in Europe, but as long as countries such as Brazil and India are willing to stand proud as Creditor instead of Debtor, as they were in known in the (recent) past, countries like Belgium will still be the tax paradises for rich companies and their owners. That is, however, another story, which I will cover in more depth in a future article.
1 comment:
There is a remarkable irony in the reversal of roles and such an important truth- growth is now centered in a few places including Brazil. You raise the issue of Brazil giving aid, and the even more important issue, of the aid still needed within Brazil. So often these things go in a backward fashion- a nation giving aid abroad, overlooking its own people; then because aid goes abroad, people in Brazil will see this, and demand more schools, roads, medical facilities. Poverty is real and persistent in every rich country and Brazil is one of them now. The voices of the poor are not heard as clearly as the rich, their desperate needs can be forgotten in preference to more luxuries for the wealthy.
I think you have the start here of many things that need to be said, how the role of Brazil on the world's stage is still not as important as the care of its own people- the true test of a great nation--how it treats the most vulnerable of its citizens. I look forward to reading more, especially about taxes and corporations making billions, receiving so much from the public, and paying little or nothing. Well done!...HDMoore
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